medium · Market Microstructure
Under the National Market System (Reg NMS), if Exchange A is quoting a stock at $10.00 x $10.05 and Exchange B is quoting $10.00 x $10.03, what does the 'Order Protection Rule' prohibit?
- Providing Payment for Order Flow (PFOF) rebates to a retail brokerage firm.
- Quoting a $50.00 stock in $0.005 half-cent increments, violating the sub-penny pricing rule.
- Allowing a dark pool to execute an institutional block trade at the exact NBBO midpoint price.
- Executing a buy order at $10.05 on Exchange A while the $10.03 offer is available on B.
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